STOCKS EXPLODE TO AN ALL-TIME HIGH: Here's What You Need To Know

Traders dressed in a
carnival costume toast with a glass of sparkling wine at the
stock exchange on Shrove Tuesday in Frankfurt March 4,
2014.REUTERS/Ralph
Orlowski

It was a huge day for stocks.

First, the scoreboard:

Dow: 16,395.8 (+227.8, +1.4%)

S&P 500: 1,873.9 (+28.1, +1.5%)

Nasdaq: 4,351.9 (+74.6, +1.7%)

And now the top stories:

Markets surged as
Russian President Vladimir Putin's rhetoric eased up.
"There has not been a shot fired in Crimea," said Putin during
a translated press conference. "The tense situation in Crimea,
related to the possibility of the use of force, has been
exhausted. There was no necessity of that."

But that's not to say there's peace on the Ukraine-Russia
border. "We do reserve the right to use all the means to defend
these people," said Putin. "We believe and do believe that
Ukraine ... is our fraternal nation."

"[The] sell-off has taken the market to technically extreme
oversold levels," wrote Morgan Stanley's Jacob Nell
regarding Russian stocks. "Valuation multiples have only
been cheaper at the depths of the 2008 crisis (when earnings
fell by 60%). And oil markets are stable in contrast to
sell-offs in Russia historically. Despite the obvious hit to
growth expectations implied by the crisis, any sign that
tensions are beginning to de-escalate would constitute a buying
opportunity."

The S&P 500 got as high as 1,876.2, leap-frogging over
Friday's intraday high of 1,867.9. So, anybody who
followed Warren Buffett's lead and bought stocks during
Monday's sell-off would already be in the money. "We were
buying it on Friday, but it's cheaper this morning and that's
good news," he said on Monday to CNBC's Becky Quick.

In his new monthly Investment Outlook,
PIMCO's Bill Gross argues that risk-assets like stocks
could continue to rally as long as the world's central banks
have the confidence of the market players. "[I]f global central
bankers can convince investors that their abnormal policies can
recreate a semblance of the old normal economy, then risk
assets at the outer edges of our circle will have higher future
returns than otherwise," he continued. "As long as artificially
low policy rates persist, then artificially high-priced risk
assets are not necessarily mispriced. Low returning, yes, but
mispriced? Not necessarily."